Tax sweetener sour for employers

May 19, 1995

Dominic Cadbury, as an officer of the CBI, is clearly not a disinterested observer of the debate on higher education funding. In previous generations the same professional employees would mostly lack a university education, but would still have enjoyed higher salaries than their blue collar and manual worker colleagues. One could easily argue the opposite of Mr Cadbury's case; that employers are now subsidised by the other funders of higher education in that a degree reduces the amount of on-the-job training required to turn a young recruit into a useful professional employee.

Similarly, Mr Cadbury's contention that "employers already contribute a great deal in terms of research, consultancy, help with teaching and student support" cannot pass without comment. Employers who support students at university are greatly appreciated by all concerned, but they are rare. For the rest, a "contribution" is rarely made without strings and is usually closer to a payment for a service rendered. Consultancy is a commercial product and academic consultants are taken on to fulfil a need, usually to supply expertise not available in the client organisation. The client expects value for money and will require the consultant to deliver well defined work to the value of the fee. There is no "contribution" involved. Likewise, in my experience of research jointly funded by industry and a research council, the industrial sponsor always ensures the relevance (i.e. industrial usefulness) of the research objectives and is assiduous in monitoring progress to ensure that relevant results are obtained. Even "help for teaching" is mainly concerned with giving the universities guidance on relevance, to enable them to supply prospective employers with the graduates they would like. In no case is funding given to higher education without the prospect of some return.

Collaboration with industry in research and consultancy provides valuable revenue and the insights can be a source of inspiration. However, the CBI cannot claim that industry is paying more than its share of the cost of higher education. Employers pay no more than a fair price for their graduate employees and industry rarely "contributes" without a good prospect of a return.


Department of Mechanical Engineering University of Newcastle upon Tyne

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